Baptist Health South Florida will pay $7.8 million to settle FCA suit

Baptist Health South Florida Inc. will pay the United States $7,775,000 to settle claims that it violated the False Claims Act and the Stark Statute between 2003 and 2005. The government alleged that the healthcare system paid excessive compensation to an oncology group that was a source of patient referrals, according to an article in the Sun Herald.

The Stark law prohibits providers from billing Medicare and Medicaid for referrals from doctors with whom the providers have a financial relationship, unless that relationship falls within certain exceptions.

Computer Sciences Corp. settles FCA suit

Computer Sciences Corporation (CSC), an information technology and business services company, will pay $1.37 million to resolve allegations that it solicited and received improper payments on technology contracts with government agencies, the Justice Department announced on May 15, 2008.

The whistleblower complaint which originated the suit alleged that CSC received payments, known as alliance benefits, from a number of companies with whom it had global alliance relationships. These benefits amounted to kickbacks and undisclosed conflict of interest relationships.

FCA case alleging customs fraud settles

The U.S. Attorney's Office for the Southern District of New York announced the settlement of a customs fraud case for $2.8 million.

The suit, which originated as a whistleblower complaint, involved three importers, Intertex International Inc., J.J. Basics, Inc. and the Red Zone, Inc., that imported goods for U.S. companies, including Wal-Mart Stores, J.C. Penney, Kohls and Marshalls.

The whistleblower alleged that the companies misstated the country of origin of imported goods in order to evade quota restrictions and sometimes understated the value of the imported goods.

Connecticut attorney general calls for False Claims Act

Connecticut Attorney General Richard Blumenthal has asked the state's legislators to enact a False Claims Act. A special legislative session is starting and Blumenthal thinks the legislature should take this opportunity to pass an act, modeled on the federal False Claims Act, that would allow citizens reporting fraud to receive a portion of the damages.

Stamfordplus.com says that Blumenthal also advocates strengthening whistleblower protections.

U.S. joins qui tam suit against government contractor

The U.S. Department of Justice has joined a whistleblower suit against Materials and Electrochemical Research Corp., saying company officers created a false company and forged signatures to obtain millions in government contracts.

The suit alleges that the Tucson, Arizona, company filed falsified documents to get contracts with NASA, the Dept. of Energy and the Dept. of Defense. The contracts involved optics and nanotechnology research, according to a May 9, 2008 article in the Tucson Citizen.

Federal government sues NJ cardiologists

Heartwire reported on April 28, 2008 that the federal government is suing two cardiologists for their role in an alleged kickback scheme. The two are among 16 cardiologists who are alleged to have participated in a scam in which the University of Medicine and Dentistry of New Jersey (UMDNJ) gave them the titles of assistant professors and salaries in return for referrals. The "professors" did npt perform any teaching, research, or patient-care duties.

The lawsuit claims the two are guilty of violating both the federal Stark statute, which prohibits referral of Medicare patients to a hospital with which a doctor has a financial relationship, and the False Claims Act, which allows triple damages for submission of claims that are false because of a prohibited financial relationship.

New Orleans hospital settles FCA allegations

Touro Infirmary, a New Orleans hospital, will pay the United States $1.75 million to settle allegations that it submitted false claims to the Medicare program, the Department of Justice announced on April 17, 2008.

The lawsuit alleged that Toura made unlawful payments to a psychiatrist to induce her to refer patients to the hospital. Federal law prohibits the payment of kickbacks or other inducements for referrals of patients participating in federal health care programs.

Government joins qui tam suit against California radiology clinis

The U.S. Attorney's Office in Los Angeles filed a complaint in intervention in a whistleblower lawsuit brought against The Oaks Diagnostics, Inc., according to an April 14, 2008 press release.

The suit alleges that the clinic defrauded Medicare by billing for unnecessary radiological tests, such as CT scans and MRIs.

Heartland Dental settles whistleblower suit

Heartland Dental, an Illinois company that manages dental practices in several states, has agreed to pay $1.65 million to resolve allegations that it falsely billed Illinois Medicaid. The whistleblower suit, brought under the qui tam provisions of the False Claims Act, accused the company of defrauding Medicaid by miscoding uncovered procedures as though they were covered and upcoding simple procedures as though they were complex.

The company will also pay the U.S. $1.35 million to resolve allegations that newly hired dentists issued prescriptions prior to registration with the Drug Enforcement Administration as a means to generate revenue for Heartland, according to the April 11, 2008 press release from the US Attorney's Office in Springfield,

Manufacturer settles defective bulletproof vest lawsuit

Protective Products International Inc. (PPI) will pay the federal government $960,000 to resolve a False Claims Act suit, the Dept. of Justice announced on April 10, 2008. The suit alleged that PPI sold the government Zylon bulletproof vests it knew were defective because the Zylon material was not appropriate for ballistic applications.

Other posts on Zylon suits can be found on November 7, 2007 and July 6, 2005.

Florida Radiologist to Pay $7 Million to Resolve FCA suit

Radiologist Fred Steinberg, M.D., his imaging centers and related entities in Palm Beach County, Fla., have agreed to pay the federal government $7 million to resolve allegations of health care fraud, the U.S. Dept. of Justice announced on April 14, 2008.

The suit, originally brought under the qui tam provisions of the False Claims Act by David Clayman, alleged that portions of CT scans were not performed, even though the procedures were billed and reported to patients’ physicians as if they were done. The bills were submitted as though CT scans were carried out both with and without contrast, when in reality the CT scans without contrast were not performed. The government also alleged that the Steinberg entities did CT scans and ultrasound exams that were not ordered by physicians and were not medically necessary.

Mr. Clayman was represented by Peter Chatfield of Phillips & Cohen and Janet Goldstein of Vogel, Slade & Goldstein.

Medicaid Dental Center resolves FCA suit

Medicaid Dental Center of North Carolina will pay $10.05 million to resolve False Claims Act allegations, the United States Justice Department announced on April 9, 2008.

The company was accused of billing the North Carolina Medicaid program for medically unnecessary dental services performed on indigent children. Among the medically unnecessary procedures were pulpectomies (often referred to as a “baby root canal”) and placement of stainless steel crowns.

Geriatric care provider will settle FCA suit for $117 million

HealthEssentials Solutions, Inc., a former Kentucky-based provider of geriatric care, has admitted to to submitting false claims to Medicare. The company has agreeed to criminal restitution of $3.1 million and payment of $117 million to resolve civil claims under the False Claims Act.

Three different whistleblower lawsuits filed by four former employees of the defendant company, alleged that HealthEssentials engaged in upcoding – the practice of improperly assigning a billing code to a patient that is not supported by the medical record for the purpose of obtaining a higher level of reimbursement.


The March 28, 2008 press release from the U.S. Attorney's Office for the Westen District of Kentucky said that the company billed visits to patients in assisted living facilities as though they were performed in patients' homes.

On March 1, 2005, HealthEssentials filed for Chapter 11 bankruptcy protection.

Wackenhut accused of overbilling Miami-Dade County

A whistleblower lawsuit accuses Wackenhut Corp. of billing Miami-Dade County for 69,000 hours of security work that the company's employees were never paid for.

The Miami Herald reported on April 7 that the "ghost posts" on the Metrorail transit system and at the Juvenile Assessment Center cost the county nearly $1.6 million.

Judiciary Committtee approves False Claims Act amendments

Proposed amendments to the False Claims Act were reported favorably out of the Senate Judiciary Committee on April 3, according to Federal Times.

The bill, S 2041, sponsored by Sen. Charles Grassley, R-Iowa, would strengthen the False Claims Act, which has been weakened by a series of court decisions that limited both the ability of whistleblowers to file lawsuits and their ability to recover claims.